All-In with Chamath, Jason, Sacks & Friedberg - Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax

Starting point is 00:00:00 What did you think about that reservation article thing? Oh, that's crazy. Well, this is a great topic. There is a guy, a pretty industrious kid, it turns out what this kid's been doing is he's been getting carbon reservations, other top tier reservations. And by the way, everybody's had this as an app idea. Nobody's really executed it that well. I don't want to give any plugs for any apps right now. But he has been selling $70,000. He's been flipping restaurant reservations for upwards of a thousand bucks. Chamath, you're very industrious and you're an absurd tipper, 100% tipper minimum. I know this because when I paid for dinner one time

Starting point is 00:00:36 at Carbone, you took me and Phil Helman's cards and you said, you guys pay and I'm gonna put the tip in. And then I had to sell Uber shares to cover it. That was gross. That was gross. I've never had problem getting a reservation at any restaurant in New York. Yeah, they see you coming.

Starting point is 00:00:53 You know what they say? 10 dimes worth of wine. I have taught many of my friends how to get reservations. I have a series of tips that I could give, but I don't want to give too many of them away. But nobody gives tips to matri-des anymore. Sax, you tip the matri-des with cash? All the time.

Starting point is 00:01:10 Yeah, sure. Of course, right? See, this is where Sax and I get along. Sax is a legit old school guy. Yeah, Sax is elite. He's got the a hundred dollar bill pressed into his palm, shakes the guy's hand. I'll tip the bartender to keep the ice cubes cold.

Starting point is 00:01:24 The bartender got a hundred just for keeping the ice cubes cold. There you go. This is my tip. It has worked. I'm going to give it out here. And the reason I'm giving this out is because y'all are cheap. And not you, but just a lot of y'all out there and you don't know the art in Brooklyn. Everybody gets tipped. We tip the phone guy when it comes to fix your phone at your house. Everybody gets tipped.

Starting point is 00:02:05 So here's what I would do. And you can do this with a 20. You can do it with a 50. You know, if you're going to some great place, you can do it with a Hyundai. You fold it twice. As Chamath says, you put it in your palm. You walk up to the matriot stand. If there's anybody in line, you just cut it

Starting point is 00:02:24 and you go to the side of the table. you put your hand on the major D stand, you push the handover slightly, here's the major, you send you just slide your hand over and you reveal the 50. And you say, I am so sorry, I was supposed to make a reservation. I don't know if my assistant did or not. She probably didn't. However, I'm a huge fan of the restaurant. If there's anything you could do for me, I made a stupid mistake to not make a reservation. If somebody cancels, I'll be at the bar if there's anything you could do for me, I made a stupid mistake to not make a reservation.

Starting point is 00:02:46 If somebody cancels, I'll be at the bar. If there's any way you could accommodate me, I truly appreciate only in town for one night. When I say 99 times out of 100, it works. The one time it didn't work. How much are you tipping? 100? It used to be 20 when I lived in New York. Now I regularly do 50.

Starting point is 00:03:04 And the reason I do it is I don't like giving money to charity. I feel like these charities are all a giant scam. And I like to give it to service people like is it awkward when you tip $50 in ones like that? Like doesn't it? It's a little harder to hold in your hand. I used to use a roll of quarters. Actually, that was all the quarters was a little bit hard. I'm just asking everybody here, if you hear my voice, please go tip your matri d 20 or 50. And report back if my technique works. Because what you're doing in the framing is you're saying you made a mistake. And then you make it so the person

Starting point is 00:03:37 doesn't feel like you're bribing them or paying them off. They're helping you solve a problem. So anyway, it's kind of like when I troll David, and I'm like, hey, freeberg, with this with the summit, whatever needs like, I'll do all the work, forget about it. You just got to reframe it. All right, let's get started here. But it's a bribe. That is a bribe. It is in fact a bribe. Yeah. I consider it. It's interesting to bring this up. You're creating plausible deniability, but it's still a

Starting point is 00:04:03 bribe. I consider it a tip in advance of services. No, you're not tipping him for good service. You're tipping him to basically break in line. Yeah. You don't make a reservation, and you're taking away somebody else's spot, and you're paying him to break the rules. It's couple words.

Starting point is 00:04:18 You know what? Your shift to man of the people is the most brilliant move you ever made. No, but it's a bribe. It is a bribe. It's a brilliant move. You have for me. No, but it's a bribe. It is a bribe. It's not a bribe. You're not even really doing him a favor. You're doing yourself a favor. All right.

Starting point is 00:04:31 Let's unpack. You're such a populist. So fucking brilliant. I hate you. He just figures out a way to get those populist votes. No, here's what it is. Cause I had this argument with my fortune. You gave him the 50 just for doing a good job,

Starting point is 00:04:45 even if you had the reservation, is what you're saying. I am so confident in how good the service is going to be. I'm giving a pre-tip. I consider it a pre-tip. Oh my god. A pre-tip if he gives you a reservation when you don't have one. I am happy to not get the money back

Starting point is 00:05:00 if they can't accommodate me. One time it happened, the woman at Asia to Cuba, in New York in the 90s said, here's your 20 back. And she said, I'm really sorry, there's nothing I can do. I would love it's very lovely of you to give me the tip. And she handed it back to me. And I said, keep it. And she said, No. But I got the bartender is going to take care of you at the bar. So that ends well. All right, let's get started. Everybody. We have a full docket for you today. And story of the week as voted by besties. We have a new system here instead of me sorting the

Starting point is 00:05:30 docket. The besties give a thumbs up thumbs down. This one I think had two of three people voted for it. One person didn't vote this week. And that is Zuck's scorched earth AI strategy. As you probably know, if you're in tech, Meta was the first big tech company to fully embrace open source AI. Llama leaked last year. Folks said that it wasn't leaked, it was released covertly or on the slide DL by the folks at Meta. But they just released llama three.

Starting point is 00:05:59 And I talked to Sundeep about this a whole bunch last week. It just came out a few days ago, and it's already in the top two models on hugging faces leaderboard, you can take a look at hugging faces leaderboard. It's basically where it's the most trusted place, I think, where people benchmark these things developers are saying it's faster. It's less preachy was an observation and chat GPT four, despite being slightly lower quality, they also have some

Starting point is 00:06:24 small models that are performing really well. They also announced very interestingly, open sourcing the quest operating system called meta horizons. OS the OS powers the mixed reality headsets VR all that kind of stuff. They are. But here's the big news. This one is amazing. Instagram, Facebook and WhatsApp are integrating a search box or their AI assistant chat box into all their apps.

Starting point is 00:06:47 Worth noting, Meta came out with their results just the other day, and we're taping this on Thursday, as you know, it comes out Friday. Their stock is down as much as 16% after reporting its Q1 earnings. They beat estimates, but Zuck is saying he's gonna spend a bucket load of cash on infrastructure. Shamath, it's your alma mater.

Starting point is 00:07:07 You worked side by side with Zuck growing Facebook from what? 10 20 million to 400 million? mouse? What do you think of his 100 million when I left? Okay. What are your thoughts on gold chain Zuck and his new strategy to pivot away from VR to AI and going full all-in, so to speak, on open source. They're taking a play that we talked about, which makes a ton of sense, which is it's not a core market, but it's very important. The core money-making market for them is monetizing their family of apps.

Starting point is 00:07:45 And so they're scorching the earth for these new markets so that the economics are not viable which will, I think, allow a more robust ecosystem where they'll have more of a say. Because I think up until this point, you could have said that they and Google were sort of lagging behind OpenAI. But I don't think that's the case. And by the way, this is the strategy that we talked about 16 months ago that these big companies should take. I just think it's worth listening to what we said. And then basically what Zuck said just right now. Here we go. This is a black and white flashback. Chamath in. Turtleneck, go.

Starting point is 00:08:23 I think that Google will open source their models because the most important thing that Google can do is reinforce the value of search. And the best way to do that is to scorch the earth with these models, which is to make them widely available and as free as possible. That will cause Microsoft to have to catch up and that will cause Facebook to have to really look in the mirror and decide whether they're going to cap the betting that they've made on AR VR and reallocate very aggressively to AI. That should be what Facebook does. And the reason is if Facebook and Google and Microsoft have roughly the same capability in the same model, there's an element of machine learning called reinforcement learning, and specifically it's reinforcement learning from human feedback. Facebook has an enormous amount of reinforcement learning inside of Facebook. Every click, every comment, every like,

Starting point is 00:09:16 every share, the huge companies will create the substrates. And I think there'll be forced to scorch the earth and give it away for free. Now you can see what Zuck said last week. Look at this little victory lap here. It's probably also pretty bad for one institution to have an AI that is way more powerful than everyone else's AI. And I kind of think that a world where AI is very widely deployed in a way where it's gotten hardened progressively over time and is one where all the different systems will be in check in a way that seems like it is fundamentally more healthy to me than one where this is more concentrated.

Starting point is 00:10:00 That is, I think, the definition of scorched earth. So and he's he's running a really perfect play so far as he's open sourced the headset OS, he's opening source these models, he stopped training, I think, for llama three, five, was it and now he's moved directly to llama for just to try to head off GPT five at the pass. Well, so what are we seeing, we're seeing the economic value getting disintegrated, there is no value in foundational models economically. So then the question is, who can build on top of them the fastest? And Jason, to your point, llama was announced last Thursday, 14 hours later, grok actually had that model deployed in the grok cloud, so that 100,000 plus developers could start building on it. That's why that model is so popular. So it puts the closed models on their heels

Starting point is 00:10:49 because if you can't both train and deploy iteratively and quickly enough, these open source alternatives will win. And as a result, the economic potential that you have to monetize those models will not be there. And what that does is reinforce the existing economic moat that Facebook already has in monetizing their apps. Now, why the stock went down, I'd like to talk in contrast to Tesla a little bit later,

Starting point is 00:11:13 because this has nothing to do with that, and it's more about squares versus sharps in the stock market. Freberg, your thoughts on meta embracing, going all in on AI. You were at Google, your alma mater, and you watched them be proprietary and close when it came to search and the search algorithm. But open source when they were behind, and that's I guess the phrase we use here in Silicon Valley, when you're behind, you use open source to catch up. And when you're ahead, you close everything down. Facebook famously shut down all access to their APIs. You can't get into the social graph, but they're going open here. Why? Because they're behind.

Starting point is 00:11:57 Your thoughts on this from, say, a Google perspective and then maybe how Google might react and then just broadly, do you think open source wins the day getting to AGI? I would say the analogy for Google is Android, where Google open source the Android operating system because the handset manufacturers and some of the big software companies, so Nokia and Microsoft in particular, Blackberry had these closed proprietary operating systems. And then the telcos put their apps on and make money and basically had control over whether or not people could access Google and Google services through their phone.

Starting point is 00:12:36 So the intention with open sourcing Android was to make sure that Google was not disadvantaged in their core business over time. I think that there's a similar analogy here that by open sourcing these models, they limit competition because VCs are no longer going to plow half a billion dollars into a foundational model development company. So you limit the commercial interest and the commercial value of foundational models. Now the CapEx question is, is a really hard one to diagnose because we don't

Starting point is 00:13:03 know how they're spending the money, where they're spending the money, what they're doing in there. I think that it's a really important sign that founder led companies with these voting rights, you know, have the ability to make these sorts of hard decisions that it might be very difficult for a management by committee group to make. Got it. Look at how Mark is making these decisions. And Elon is making big tough decisions that it would very likely be pushed back on if they didn't have the voting rights if they didn't have the control over the company that they had. It's a great point about founder authority. I think that's a really salient point. Shout out to Zach would really be great to get him at the All In Summit. Sax, we have some breaking news here.

Starting point is 00:13:44 It turns out Lama 3, they just tested it in the benchmarks. It says here, you can make the founding fathers any race you like. It's a really interesting feature. Any thoughts on Facebook's strategy here? You are a master strategist, David Sachs. Give us your master strategy here, 1700 chest rating? Sax? Well, we kind of glossed over what the real news was, which was that Meta released Lama 3, which they had spent billions of dollars creating in a completely open source way. And the testing on Lama 3 is that it's comparable to GPT-4. And I think this is what Chamath means by scorched earth is that we now have a free model that's as good as GPT-4. Best in class.

Starting point is 00:14:26 Best in class. Or at least tied for best in class. There are some slight differences, and we've been playing around with it. It is faster and cheaper than using ChadGPT-4, but the context window is smaller. I think it's only an 8,000 token context window. So that's something that the open source community

Starting point is 00:14:46 is going to need to work on is, you know, rolling out foundation models have a bigger context window. Nonetheless, the point is that at least for now, until open AI comes out with GPT-5, which is supposed to happen soon, the open source community has kind of caught up with the top closed source model, which is supposed to happen soon, the open source community has kind of caught up with the top closed source model, which is OpenAI. Will they blow past the closed source model, Sax?

Starting point is 00:15:13 Well, I still think that OpenAI is ahead because the scuttlebutt about ChadGPT5 is that it's amazing and it's a big improvement over GPT4 and supposedly it's gonna come out any day, week, or month. So if GPT-5 comes out and knocks our socks off in a few weeks, then we're going to see that, oh, they're actually a cycle ahead of the open source community.

Starting point is 00:15:37 But as of this moment, in terms of what's been publicly released, I think it's fair to say that open source is largely caught up with open AI. And this is why, you know, bring up this tweet by Naveen Rao, who is a founder who created the company Mosaic ML, which is sold to Databricks for unicorn outcome. And he says, I don't think everyone has comprehended the massive disruption and distortion that's going to happen in the gen AI market due to llama 3. Votes will be destroyed and investments will go to zero. Just like everything in gen AI, this will all happen fast. So you know it's a similar reaction to what Jamath is saying which is we have an open source model now that erases

Starting point is 00:16:18 billions of dollars of private investment. And by the way you just said something really interesting before which is is, okay, there's a limitation, right? You mentioned the context window, which was a problem. I just found this thing today. They solved it. Now they're at 96K context. Yeah, that's amazing. So to your point, Sax, this market is moving so fast

Starting point is 00:16:39 because you cannot compete with open source. So all these closed models, which means OpenAI and a bunch of these other folks, especially the ones that are sitting inside of these smaller companies, right? Snowflake has a model. I think Databricks has a model. There's a important question that has to be asked

Starting point is 00:16:56 around the economic viability of these models in a world where open source is not only better and better funded, but they're iterating faster and the feature set is catching up to your needs. So the minute that SAC says he needs a longer context window, within a week it's there. That's pretty intense. Yeah, I think this is like one of the- What do you think, J.K.L.? Well, I've got a totally different take on this. Obviously, I agree with all you've said here in terms of the open source and the dramatic effect it's going to have on pricing, but there's something people are missing. If you go to meta.ai

Starting point is 00:17:30 for a second, Nick, and you pull it up, what you'll see is they've dedicated the meta.ai URL to a search-like experience. And then they've put a search box at the top of Instagram, WhatsApp, they've put search box at the top of Instagram, WhatsApp, and Facebook. And so they are going to put search engine, essentially their modern search engine, which is starting from zero in front of 3 billion people using Meta's collection of services. And so just like Apple and Firefox were able to intercept search traffic, I think, let's make a prediction here, that medicine to get 10 points of the search market. Now, each point of the search market is worth, you know, what is Google's worth about 2 trillion, if you take out 500 billion for YouTube and their other services, you get 1.5 trillion, which means 10 points is worth 150

Starting point is 00:18:21 billion in market cap. Now, as you well know, Chamath, and you all know David, these two ad networks met us started with psychographic data, the person who they know. And then of course, Google had the greatest advertising product ever intent. You type in Volvo, you type in Tesla, type in Tesla Santa Monica used, you know, you don't have to guess what the person is interested in at that moment. Well, for the first time, you know, one of these ad networks has content data and psychographic, and they're going to be able to put it together. And I think they take 10 points of search.

Starting point is 00:18:55 But more importantly, they're going to have data on individuals that will be unrivaled in the advertising space. Now Google tried to do this themselves. They did something called Google Plus. I don't know if you were there, Freiburg, during the Google Plus era, they spent billions of dollars on a social network. It failed. They shut it down because they wanted to get that. So looking at this, I think, man, there's so much going on on open source, but now Google, we haven't talked about Google's role in all of this and Sundar being a hired gun, not having founder authority to your point, Freiburg.

Starting point is 00:19:28 You know, I think they're going after Google search business as well as, you know, taking away and commoditizing all of the open source. So we might be sitting here in three or four years watching Meta have, I don't know, 10 points to search. Nobody has to search. It's just that Google can't afford to lose anything. Yeah. Everybody takes a point here and a point there,

Starting point is 00:19:49 and all of a sudden Google could be in the high 70s of search and that would be economically disastrous for their stock. Yeah, you're gonna have to make cuts. Why do you guys think the stock is down? Why is the stock down 16%? I have a theory as to why. That tells you a theory. Go for it.

Starting point is 00:20:06 I think that there's a few times a quarter where you can really see the dispersion in the stock market between what I would call the smart money and everybody else. So, using betting language, the sharps and the squares. And I think Meta was an example of the Sharps taking a line, which I think is very accurate. And Tesla was the other great example this quarter. And so if you look inside of Meta, and this, Friedberg mentioned this earlier, I think Friedberg, what people really reacted negatively to was the total quantum of spending and the idea that it's misallocated, not to AI, but specifically to Nvidia. The reason is that, and we've mentioned this before, I've tried to talk a lot about this with Jonathan Ross from Grok, but AI is really two markets, training and inference.

Starting point is 00:21:02 Inference is going to be 100 times bigger than training. And Nvidia is really good at training and very miscast at inference. The problem is that right now we need to see a capex build cycle for inference. And there are so many cheap and effective solutions. Grok being one of them, but there are many others. And I think why the market reacted very negatively was it did not seem that Facebook understood that distinction, that they were way overspending, and trying to allocate a bunch

Starting point is 00:21:34 of GPU capacity towards inference that didn't make sense. And so I think what people were saying is, hold on a second, so far, your plays are perfect. It's everything we want you to do We want you to scorch the earth We want you to open source the headset But we also want you to understand the difference between training and inference in a little bit more of a nuanced way Build up the inference capacity but spend a lot less money because you don't need to spend it on Nvidia And the reason is the sharps know that Nvidia cannot do inference

Starting point is 00:22:03 And so I think that's why the stock is down this much. And I think it's important for people who care about AI, but also may traffic in Nvidia to understand why the sharps think that. And I think several of us have tried to explain it now for the last couple of weeks, but it is miscast. And so you're overspending. Up next, Tesla earnings, Elon's masterplan part two is going well as planned. Again, this was voted up by our panel here in our group chat. Last time we covered Tesla

Starting point is 00:22:31 was episode 164, early February after a Delaware judge voided Elon's pay package. Since then, Tesla has made some giant moves. They launched FSD 12. I've been using it. It's pretty great. Also they cut the price of FSD by one third from 12 K to eight K. I think you can also get it for 100 bucks a month. And they announced a 10% riff going to cut 14,000 employees always painful to do that. They're looking to reincorporate in Texas leaving Delaware for obvious reasons. Earlier this week, Tesla shares were down more than 40% year to date, mostly due to a decrease in demand for EVs.

Starting point is 00:23:07 Market caps dropped from 750 billion to 460 billion. Shares dropped 12% when they reported Q1 earnings on Tuesday. Investors got excited after Elon announced that Tesla's new line of models could start production at the end of the year or maybe even early 2025. He shared some thoughts on the robo taxi or cyber cab, which he talked about maybe five or six years ago when he has had in the master plan for a long time Shamath. You made some great calls on Tesla and made some great trades there back in the day. Your thoughts on Tesla in 2024. Sharps love it. This is another one sharps versus the squares.

Starting point is 00:23:50 Why did the sharps love it? Why did it go up and everybody was so confused? And I think the answer is that he's actually executing exactly the plan. And so if you're investing in a stock, what you really want is a CEO to kind of stick to a plan that is well known. So we don't have to actually guess what the plan is because he puts it out on the website. Look at the master plan, part deux. And if you start reading down everything that he said he's going to do starting in 2016 is basically what it is. So let's take the first part, right? What did he say in the first part?

Starting point is 00:24:21 He said, Hey, listen, guys, this is 2016. we're going to build a model three, we're going to build a compact SUV, the Model Y, we're going to build a new kind of pickup truck. Okay, check, check and check. Then he said, Oh, by the way, we're also probably going to have to do a heavy duty truck and a high passenger density urban transport vehicle. So that's the robot taxi thing that he's going to announce in August. Okay, check and check. And then he talks about the software and the investment in FSD and trying to get to a place where you can just have a much higher probability that it will save you from an accident and it'll keep you safe when you're driving your car, which will be a large driver of why people want to buy the cars themselves. And you can see these FSD miles. So if you're a smart capital allocator, what you actually saw was

Starting point is 00:25:06 a dislocated stock price. What you saw was a plan that by and large he's been executing on at a strategic level. Underneath, there's the vicissitudes. What are the vicissitudes? Sometimes you over hire, you need to trim some fat. Sometimes you overspend on CapEx. Now he spent about a billion of CapEx this quarter on AI infrastructure, so H100 for training. But the market saw through it because that was a reasonable amount of money to spend on training for FSD. Right? So you can start to see the tale of these two reactions. The Sharps looked at the capital allocation and said, okay, you missed by two and a half billion this quarter, but that's going to create a buying opportunity because we think it's roughly

Starting point is 00:25:50 mispriced. And we think it's mispriced because going back to this plan from 2016, this is all the things that we've been underwriting from $40 billion of market cap to 750. And now we're getting a 40% discount to buy back in. So I think it's a really interesting moment to just contrast and compare what sharps look at, and then what the media breathlessly exaggerates. And I think what they wanted was to lionize the meta-earning story, but the sharps rejected it. And they wanted to dump on Elon, and the sharps rejected that in size in both cases. And it's just a reminder to all of us, be very careful

Starting point is 00:26:32 what you're reading. Because if you just took the headlines, you would have expected the two reactions to be exactly opposite. But when you vote with money, it's very clear and unambiguous, because you actually move in the direction of accuracy. And that's what the stock market allows you to see. And I think this is a really interesting contrast to compare sharps versus squares here. Yeah. Just well recapped. For those who don't know sharps in gambling, are people like Harall and Bob, friend of the pod, who are just the sharpest bettors in gambling. Facistitude, that's an unpleasant change in circumstances, for those of you who don't know the word. Sax, I don't know if you want to comment.

Starting point is 00:27:09 I mean, you and I are biased in this with the relationship with Elon. Any thoughts on Chamath's take? Well, I'm not gonna comment on the stock per se. I mean, Tesla's products are amazing. They seem to be really executing well there. And I think that Elon foreshadowed on that earnings call what's coming in the future.

Starting point is 00:27:29 I'm personally really curious about the Optimus robot. I mean, that has the potential to create an entirely new market and bring about something that we've only seen in science fiction. So to me, that's very interesting. I think in terms of the company's problems, I think they're mostly dealing with some macro forces.

Starting point is 00:27:48 So, first of all, the GDP growth rate has slowed to 1.6% in Q1. So, this just came out. And that was a notable slowdown relative to expectations. So, first of all, you're dealing with a slowing economy, it seems like. Second, high interest rates mean that car payments are higher. If you want to finance the purchase of a car, your car payments is going to be a lot higher when interest rates are above 5%. And I think that has been a pretty big headwind for Tesla and really all the car companies

Starting point is 00:28:20 over the last year or so. But I would say that I think both of those things are ultimately cyclical and what matters is test Those products I would say the only issue they have that's a real Long-term issue is just the the Chinese competition Companies like BDY are ramping up production of knockoff products at low prices and so managing the competition with China is probably The only one of these issues that's,

Starting point is 00:28:46 I think, probably a long-term issue for them to deal with. Let me ask a question here. How do you rank these businesses? Energy, Optimus, Trucking, Ride-Sharing. Energy, Optimus, the robot, trucking, ride hailing. Rank those your number one or two in terms of potential for Tesla, Chema. Round the horn. That's a good question. Ride sharing is number one.

Starting point is 00:29:15 The absolute probably by an order of magnitude. And the reason I say that is in order for ride sharing and ride hailing to really work the way that they envision it, you will have level five autonomy supported in jurisdictions where, again, if you just look at Part Deux, the whole point is you can summon a car from your app. And if you don't have access to a mobile phone, you can go to these bus stop equivalents and just press a button and the car comes to you. And so in that world, there's just so much value add in terms of passenger safety and sustainability for the environment and less traffic. It's a gargantuan game changer. Meanwhile, What's your number two? Sorry, meanwhile, and sorry, just to contrast,

Starting point is 00:30:06 Uber and Lyft seemingly are profitable because they find pricing power to raise prices. So if Tesla enters in as a third player in that field and just guts pricing, which I think would make sense for them to do, I think this thing is just gangbusters nuclear. That's a really interesting point. What do you got, Sachs? You want to run the horn here? Well, I already said optimist, but that's based on a long-term view. Yeah, this is a long-term question based on the long-term one and two. In the long-term, in terms of option value, I am the most intrigued by the robot play. And Elon has pointed out that once you have robots that are capable of doing

Starting point is 00:30:45 lots of different jobs, pretty much any job you point them at, that we could have more robots on earth than humans. So it's a big future market. So you got Optimus number one and who's number two? I grew with Tomoth in the short term that ride sharing could really reach its logical conclusion with robo taxis. Remember, when Uber first gained steam and people were speculating about how big the market could be, there was a lot of giddy talk about how car ownership would change and you wouldn't need to buy a car anymore because you would just use Uber all the time.

Starting point is 00:31:26 We called it going full Uber. Yeah, and actually I went full Uber, or I shouldn't say full, I went mostly Uber like within a couple of years of discovering that product. Yeah, so I thought the potential was there, but the problem is it was just too expensive. I mean, Uber is still quite expensive and the most expensive piece of it is the human driving the car.

Starting point is 00:31:47 It's all that labor costs. So if you're able to charge for the ride purely based on fractionalizing the cap X and that cap X isn't even that high because they're making these road taxis pretty cheaply now. And you're able to get so much more utilization out of a car. Exactly. Right, because I mean, how many hours a day

Starting point is 00:32:08 do you drive your own car? Like an hour, maybe? Less. But a RoboTaxi- 90% I think is the number on average that they're not used. Freebrook, who's your one and two? I think the Optimus has the highest alpha,

Starting point is 00:32:22 but the highest beta. So, you know, more upside than anything else, just unclear how you get there, what the path is and the capital requirements. And I think there's going to be a lot of commoditization in this space. But the ride sharing is built in its low beta and significant alpha. So, So you're wanting to Optimus ride share. Yeah, Optimus rideshare. Chamath, what was your number two again? Just so I can recap here.

Starting point is 00:32:48 I would actually probably pick energy. And why would you pick energy as your number two after ride hailing? I think it's a pretty obvious disruption if, so today in America, if you look at the energy infrastructure, the utilities keep raising rates and they keep raising rates. And they keep raising rates independent of what it costs to generate energy. There are 1,700 utilities in America. They are by law obligated to spend, I think in the next 10 years, about $2 trillion on CapEx.

Starting point is 00:33:21 They will pass all of those costs plus a margin to consumers, even though in these next 10 years, the cost of generating an incremental unit of energy will be essentially free. So I think the very disruptive play is to take 100 million homes and make them mini utilities. Hmm. Same one. And what does it mean?

Starting point is 00:33:44 Make them utilities? You go to a website. Again, the biggest investment I've made is in a company called Palmetto. They are close to now the largest residential solar business in the United States, if not the largest already. Now what do they do? You're a consumer. You can go and lease or buy.

Starting point is 00:34:01 It doesn't really matter. And we give you a super cheap system that goes on top of your roof plus a battery system. And all of a sudden, you're totally resilient and independent of the utilities. And we help change the laws so that every time you have excess energy, you can put it back into the grid and get paid, which is called net metering. So if you have 100 million of these mini utilities, competing against 1700 incumbents that are forced to make huge investments

Starting point is 00:34:26 and are mispriced. That's an upheaval of an enormous amount of market cap, but also an enormous amount of debt. There's trillions of dollars of debt. So I've always thought a ginormous directional bet to make would be to go along the disrupter. The person that helps arm the rebels in this case would be the person that arms 100or. The person that helps arm the rebels in this case would be the person that arms 100 million homes. And then eventually at some point, just short the debt of these utilities because they won't be able to service them. If enough people quit and don't need PG&E and everybody else, it'll be just massively, massively disruptive. So that's why I think that that market could be big. I like the optimist market.

Starting point is 00:35:07 The only thing that I'll say is in my experience, when I've looked at these generalized robots, the conclusion that I came to, and I could be totally wrong, is I suspect instead of having a generalized robot, you have very specific use case robots that look differently. So for example, there's an example, Nick, you can throw a picture, but there's something called intuitive surgical, which is essentially a robot that operates on you. And if you look at that, it doesn't look anything like what you would think a robot would look like. It just looks like a ginormous

Starting point is 00:35:38 machine. And so I suspect that there will be people that become experts in these vertical use cases and That will limit the TAM for a generalized approach I could be totally wrong, but that's sort of why I ranked them the way I ranked them but I'm pretty convinced that robot axis are number one and and Then this energy thing that upends these 1700 utilities in America is number two All right, Jake how you were the third investor in uber Are you worried about your investment as I understand that you still two. All right, Jay Kal, you are the third investor in Uber. Are you worried about your investment? As I understand it, you still haven't sold, have you?

Starting point is 00:36:09 I've sold slightly more than the majority of my holdings over the years, two private transactions and then I held everything post going public. And I'm still long Uber. I give number one to Optimus by far and away because I think the build of materials on Optimus could be 10K or less. I looked at some of these other startups that are in the space and I've been studying it a little bit just out of curiosity. And so at a 10K bomb, I think they could rent you one of these for $300 a month or something like

Starting point is 00:36:45 that, a subscription. I think every human on planet earth eventually will have a robot. So I know that's crazy, but I think optimists will dwarf the entire entirety of Tesla's other businesses. Number two is energy clearly, I think. And number three is ride hailing. Number two energy, fairly obvious what's happening here. If you look at what's happening with data centers, it's spiked, I think, from like 3 or 4% of energy now to like, is it 15%, Shamath? I think we had a discussion with Phil Deutsch. Yeah, it's almost, it's almost, I think it's 18%.

Starting point is 00:37:17 It's almost 20%. It's a huge number now. Huge. Okay. So we don't tell the two stories together. These H100s are beasts. Beasts., cooling beasts. This is like, you can't even,

Starting point is 00:37:28 Phil Deutsch was telling us in the group chat, like you can't even cool some of these places. And what that means is there's gonna be demand for energy. To Chamath's point, if each home becomes a little provider, you know, it's gonna create some regulation change. I believe, I'm no expert on the regulations, we should definitely have Deutsch on the pod at some point to talk about this. But imagine these, like in Texas, they keep having the grids go down.

Starting point is 00:37:53 And in Australia, they have the grids go down. It's going to be so annoying for consumers to have the grids go down while demand spikes for data centers. All the regulations are going to get opened up to put batteries and solar everywhere. It's also dangerous. I mean, people die when these blackouts and outages occur. And also, like we saw in San Carlos here in the Bay Area, Nat gas lines explode.

Starting point is 00:38:18 PG&E is responsible for forest fires. I mean, if you can do your part to basically get off these grids, use somebody like Palmetto or somebody else and just get solar Tesla and be done with it. And at least you're not contributing to some of these downstream errors. Yeah. And so I agree a hundred percent. And by the way, if you can make money from your solar and your batteries and somebody else picks up the cost of installation, I think there are some arbitrage here, Chamath, to be had. And I think that's what you discovered when you did your first principle approach to this.

Starting point is 00:38:55 So I think those two businesses will be far bigger than anything else they're doing. Now on ride hailing, I'm using FSD12. I have been using autopilot. I was one of the first users of autopilot, you know, from the beginning, like literally. And FSD12 is a significant improvement. That being said, all of these systems work really well in a controlled grid, like we've seen with Waymo in Arizona and in, you know, limited parts of Los Angeles and San Francisco. I think that vision is five, six, seven years out from having low

Starting point is 00:39:30 single digit percentages. And you may have seen Uber has incorporated Waymo and the taxis in London into their system. I think Uber is ultimately going to be the place people go to call up one of 20 different self-driving. I think a lot of people are going to get there at the same time. Wouldn't be surprised if Elon gets there first, but I think that's five or 10 years out, if I'm being totally honest, you know, in terms of getting to scale. So I would never ever bet against Elon seeing what he's done. Watching. When Wait a second, when are you saying that

Starting point is 00:40:05 self-driving will be good enough to power just one robo taxi? Let's just forget about the scale. Just like, when will it be good enough to have like a steering wheel free car? Yeah, so if you, you can just look at cruise and Waymo and you can have your answer, which is today, in a contained environment with remote drivers intervening on some regular

Starting point is 00:40:26 basis, it works. So people are taking Waymo, San Francisco, LA on a pretty regular basis cruise. I think I kicked out of San Francisco, but in the cruise data, there was a lot of interventions going on. I suspect Waymo is doing a lot of interventions. So I think- I don't want to be a proponent of this, by the way, but bleep out his name was saying that Jason with FSD, they're very strict that you have to be holding the steering wheel and stuff. Yes. But you can go to Alibaba and buy something that hacks that right. It's a weight. A lot of not promoting that. I'm not promoting. No, no, no, no, no, no, no. I'm not promoting this. I'm just saying that it's to answer your question, sex. I think today, or let's just say by the end

Starting point is 00:41:06 of this year, an FSD-12 could be operating in a constrained space just like Waymo is. Now, to get it to all regions, back roads, you know, weather, there's a lot of edge cases here. So I think the more important question is when can automated be 5% of rides or 10% of rides? And I think that's five or 10 years from now. I do think a couple of people will reach that moment at the same time Well, let me show you a video. This is one of my co-workers at craft took this This wasn't me, but he was riding in the back of one of these robo taxis. I think this is San Francisco or New York I'm not sure which one. Mm which one, but there is no one in

Starting point is 00:41:47 the driver's seat. Yeah. But there's a safety driver watching this remote, I believe, which is what Cruz was doing. And then when they get to a point where they can't figure it out, the human comes in, intervenes. I don't see a safety driver. Where's the safety driver?

Starting point is 00:42:01 No, no, a remote safety driver. Remote, remote. But I have to say watching this video, that is the coolest bloody thing. I mean, this is amazing. I'll be honest. I think it's underrated in terms of how significant this is gonna be. Me too.

Starting point is 00:42:15 And look, if this is a Jaguar, look at that, it's a Jaguar. So you're telling me that Tesla's not gonna have something at least as good as this? Better. Soon? Yeah, exactly. Yeah, no, I think they have it already. me that Tesla is not going to have something at least as good as this. Better. Soon. Yeah, no, I think they have it already. If you drive FSD12, I believe FSD12 probably could be working today in San Francisco under a controlled grid with the remote drivers like the

Starting point is 00:42:38 other people have. If somebody knows about this, by the way, can they send us information? I'm jason at calacanis.com for life. Just send me a picture. I'll keep it on the DL. I will reveal sources of who these remote drivers are, what their setup looks like. I'm very curious to understand how the remote drivers work for Waymo and cruise. Can they park the car? They can take the car with a joystick is my understanding and move it around a garbage can in the middle of the street, Chema. Wow. And that might be the future of this. Like let's say 10 or 15 percent. Let's say 10 percent of the time it needs an intervention.

Starting point is 00:43:11 One an hour, two an hour. Having some remote person in Manila wherever watching 10 videos concurrently and looking for moments to do this. It's incredible. Cruise workers intervened to help the company's cars every 2.5 to five miles according to a New York Times article. All right, and just if we score everybody's rating here, I give two points for first place,

Starting point is 00:43:33 one point for second place. Optimist's got six points, ride hailing four, Energy Two, trucking zero. There you have it folks, there's your scores from the besties. What is Waymo? What is that? Is that like Uber and Lyft? That's Google self-driving. They spun it out. But what is it? Is it like a service?

Starting point is 00:43:49 LIDAR, $150,000 cars. Uh-huh. But is it, it competes with cruise? Yeah. They're doing what cruise did. It was the original self-driving car company that Google set up and then they set up Google X around it. And just explain to me the market guys, I'm not sure I get it. So there's weight Waymo and Uber. Yeah, there's Waymo and cruise, which are like, there's no drivers. And then there's Uber and Lyft where there are drivers. Yeah, that's the basic right? Does that Yeah, that's right. Yeah. Yeah. Okay. And

Starting point is 00:44:18 there's also Aurora. Does I don't know if Uber has owns a percentage of that or not. But I think you know about Aurora. Aurora was set up by Chris Irmson. He was the original engineering lead on Waymo inside of Google. When they did a management changeover, there was a big falling out. A lot of people ended up leaving the Waymo program. Chris left, took a bunch of people with him and started Aurora, which was basically software to do autonomous driving that they were then going to license into OEMs. So that company got backed by a

Starting point is 00:44:46 bunch of VCs and ended up going public via SPAC. And it's publicly traded today. Ah, I see. Uber owns 26% of Aurora, or actually now it's down to 20%. There's also Zucs. They made an investment in it. Yeah. There's also Zucs, which is part of Amazon. So I think there's about 10 people who are going to get to the finish line at the same time and these can be a very crowded space.

Starting point is 00:45:07 But again, some of these guys are trying to make software for OEMs so that the OEMs don't have to build their own autonomous platform. And some of them are trying to make a driving service like Waymo. And then some of them are like Tesla has a driving car. They actually sell cars. So different models. Yeah. So they're all going to convert. Yeah.

Starting point is 00:45:28 I actually disagree that there's going to be 20 or 30 of these because I actually think that self-driving is really, really hard. And we know that Tesla has been spending years getting to this point and then Google as well. So I'm not sure why there'd be more than two or three companies that can do self driving. There are 10 or more pursuing it. I do agree it goes down to four or five. And then it's a question of does any,

Starting point is 00:45:54 is it a winner take all winner take most? And that's what remains to be seen. But I mean, you need a ton of data to make it work and you need a lot of data around edge cases. And so the advantage Tesla has is they actually have real. They have so many cars on the road. They have real cars on the road with real driver minutes with drivers using the previous version of FSD

Starting point is 00:46:15 and making interventions. So they're constantly getting better. I think Google seems to be putting enough resources into this to get somewhere. But I don't think a lot of companies are going to figure this out. I think it's going to be putting enough resources into this to get somewhere, but I don't think a lot of companies are going to figure this out. I think it's going to be somewhere between one and three companies figure this out. Well, Waymo has the most on the road right now and then Cruz is second to them in terms

Starting point is 00:46:35 of in market. So the question is, how quickly can Elon get this out? Have you guys, any of you guys taken one of these robo taxis? I haven't taken one. Waymo's probably- No, that's one of my coworkers. Yeah. We got to do that. Freeberg, have guys taken one of these robo taxis? I haven't taken one. Co-workers. Yeah, we got to take one. Yeah, they're cool. They just move around. You did take one. Yeah. They're all over the city. You can take them in San Francisco now. Yeah. You have to download the Waymo app. Yeah. And there's like a waitlist and then you get on it. And, you know, they're letting people on and then you just get on it and go for a ride.

Starting point is 00:47:03 Pretty cool. By the way, someone tweeted something kind of funny. They said, you know, I took Uber years and years and like a trillion dollars to finally get to profitability and now they're about to get disrupted by robo taxis. This is brutal. Unlikely. I think unlikely. I think it's going to be a very slow rollout, you know, one or 2% a year. So but you don't get compounds. And so we'll see. All right, everybody. Is this a big win for Lena con the FTC just banned non competes, three of three people voted this up of three besties who decided to vote on the docket. Federal Trade Commission this week voted by a three to two margin to ban non competes to give you a sense of the impact here. Estimated of 18% of the total US workforce are covered in some way by non-competes.

Starting point is 00:47:47 30 million people. The ruling bans agreements entirely and requires companies to let their staff know that non-competes are non-enforceable. There are a few exceptions like existing non-competes for senior level executives. I'm guessing when you buy a company, you can get somebody to non-compete for buying their company.

Starting point is 00:48:05 The Democratic FTC Commissioner, Rebecca Slaughter, called non-competes unfree and unfair. One of the dissenting commissioners, Republican Andrew Ferguson, said the FTC lacked authority from Congress to make this ruling without specifying whether or not he agreed with it. Theoretically, the new rule takes effect in 120 days. Wow. We're on a fast timeline, after which the vast majority of existing non-competes will be unenforceable. Here in California, they're non-enforceable as we know, except under certain circumstances. So this is really an East Coast thing. People in Boston, New York, they're really affected

Starting point is 00:48:38 by this and people will actually enforce these forward things as silly as hairdressers. It was a big lawsuit by hairdressers who had to sign like 50 mile non-competes with their beauty salons. The US Chamber of Commerce says it plans to follow suit over the ruling. FTC says the rule will create 8,500 new startups a year because people can leave and compete. Freberg, your thoughts? In California, non competes are not enforceable, but outside of California, they are and they're often used like in the agriculture

Starting point is 00:49:12 industry in the ag inputs industry, where folks are developing new technology, mostly it companies based in the Midwest and East Coast. As you guys know, in financial services as well. They're often used that if you work for one company, because you have a lot of trade secrets, you can't carry them over to others. But in Silicon Valley, we're very used to engineers, product managers, executives, taking all of the knowledge and capabilities that they've developed at one business and

Starting point is 00:49:37 leveraging that into a new role. It creates a dynamically competitive marketplace. It also inflates, obviously costs because you're willing to pay more for someone who's worked directly at a competitor and has deep knowledge, but they are bringing IP often and there is, you know, a real risk that they take something from your company that you've invested in them to understand when they take it to your competitor. So I, I see both sides of this. I think non-competes give companies the ability to invest in employees and feel

Starting point is 00:50:12 confident that the knowledge and information and support they're providing to those employees doesn't ultimately find its way over to a competitor. And it gives you a rationale for paying more to your employees. It actually inflates salaries. If I'm fearful that someone might leave and take knowledge with them, I'm going to share less with the employee, I'm going to pay them less. So I could see this going both ways. I'm really fairly torn on this issue, to be honest, I don't know what the right answer is. Or if there really is a strong kind of ethical case one way or the other. I think that non competes can both benefit and hurt employees and benefit and hurt companies.

Starting point is 00:50:46 Yes, there are unintended consequences. Chimath, where do you stand on this? Is this a huge win for Lina Khan, Neutro, or a loss? I don't see non competes having any value in any market except East Coast financial markets. I've heard of folks getting something called beach leave. Typically in finance, these are Wall Street jobs, hedge fund jobs. So I know it exists there. What does it mean beach leave? Like if you leave hedge fund A and you're going to go to hedge fund B, they make you sit on ice for six months or nine months garden leave, I think maybe they call it. And the whole idea is that you don't

Starting point is 00:51:24 take any active market thoughts to your next job. For what, for what Friedberg said, I just think the whole thing doesn't make much sense. I mean, like intellectual property is the least valuable it's ever been. Right? More people develop things now via trade secret, then patents, The whole patent system has become a little bit of a game. We just talked about open source, right? They have less and less value. So innovation is happening in plain sight. And so I don't think companies are actually thinking about this issue at all anymore. They're paying people because they need to pay more to get the best and brightest. So I think if you're hoping to rely on one of these agreements, if you're an employer,

Starting point is 00:52:11 I think that you should just forget about them and just hire the best people, pay them the best and if they suck, fire them. Did you ever see that movie Spanish prisoner starring Steve Martin? Oh yeah, great film. God, that's it deep pull? Steve Martin plays the con man that goes to this guy. And the guy is like a chemical engineer. Campbell Scott is the guy's name, the actor.

Starting point is 00:52:34 And he has like a process for making a chemical and it's worth so much money. And the whole movie is Steve Martin conning him into telling him the chemical process. And eventually he took it. He was gonna give him all this money, hire him, and then he disappeared once he got the knowledge. And that was the end of it. It's a great, great film.

Starting point is 00:52:51 Shout out David Mamet. David Mamet, exactly. Yeah, fantastic. But I think there's a lot of investment that goes into intellectual property businesses that include things like chemical engineering, obviously financial services, trading companies, algos in hedge funds, and a lot in software that if you can access that intellectual property without stealing it, but actually hiring an employee that has it in their head, you gain quite a lot.

Starting point is 00:53:21 But you can do that now. I don't see it actually doing anything bad. So I have had a lot of folks that I know in other industries outside of tech or software, where California non competes are not enforceable, that aren't allowed to go work at a competitor for one year, two years, three years. No, no, I'm not disputing that it doesn't exist. I'm saying, where do you see it actually having negative repercussions in California, the point of the fact that it doesn't exist here is also seemingly that it doesn't mean

Starting point is 00:53:45 anything. Yeah, but the rate of change here is crazy. Like the rate at which software changes, I think is quite distinct from the rate at which, for example, a chemical engineering process might change, where you learn that process, you spend $200 million building a system. And then that employee can go and tell it to someone else and suddenly changes everything about that other business. So I don't know. I feel like there's something about software that gives us this point of view that maybe it doesn't matter, but in other industries it might. In that example, you'd still need to have come up with hundreds of millions of CapEx

Starting point is 00:54:17 to implement it, whatever you know. So, Saks, any thoughts? I just don't think these things mean anything. Yeah. Do you care about non-compete Saks? I think one of the reasons why the tech industry moves so fast and innovates so well is because of the happy coincidence that California doesn't allow non-competes and so the industry's never had them and as a result of that, like you're saying, the talent just flows freely to

Starting point is 00:54:39 wherever the opportunity is and you have this dynamic in tech where the VCs and the talent all swarm the biggest and best opportunities and the newest platforms in a completely decentralized way. And there's little or no friction in doing that. If you were to impose non-competes on all of the talent, there's gonna be enormous delays and friction in them moving around to pursue opportunities. And so I think it's been very beneficial to

Starting point is 00:55:10 the industry as a whole that we don't have that. Now, it's hard for me to speak to other industries, but I think that if you're looking to maximize the pace of innovation, you wouldn't have these employee non-competes. So on that level, I kind of agree with what Lena Khan's done. employee non-compete. So on that level, I kind of agree with what Lena Kahn's done. That being said, I do think the Republicans point was well taken in the sense that this was very aggressive rulemaking. I mean, I think you could legitimately argue that a change this big should be made by Congress. But I tend to think this is probably a positive change. I think this is great when Lena Kahn's doing, and this is two for two.

Starting point is 00:55:46 I think her Apple action was great. I think this is great. I'd love to have her at the summit. That would be an amazing fireside chat. So if anybody knows her, invite her to the summit. There really is three way, oh, and by the way, Chamath, media business on the East Coast also does this, and that's why friend of the pod Tucker Carlson, and Don Lemon, both of them started shows on

Starting point is 00:56:10 the internet, not other networks, because they have very tight non competes. And it's pay to play, they got paid out their full contracts, according to reports. And so there is something, I think, in a middle ground here, Chamath, where if you do want somebody to not compete, you've got to pay to play. In other words, they're getting paid. But this is what I'm saying. It just tends to be examples, Jason, over and over of markets that don't really matter that much, relying on these things and markets that are dynamic and add value in humanity, just moving past them.

Starting point is 00:56:41 So it probably makes sense for all of us to just go move past them. Absolutely. 100%. That's gonna be great for the economy. Sachs, you were gonna say something? Well, just because these agreements are no longer enforceable doesn't mean that businesses don't have modes. It just means you have to look in other places. I mean, you have to find network effects. You have to find data scale effects. There's other ways of building a mode. Product? find data scale effects. There's other ways of building a moat. Product. Besides just trade secrets or, you know, patents is another category where, you know,

Starting point is 00:57:11 in the tech industry, patents have never really mattered that much. And the only people who are seeking to litigate patents are basically patent trolls. Losers. So you want to find real durable moats, not these like legal arrangements that try to protect your business through, you know, these types of contracts.

Starting point is 00:57:26 That's well said. That's really well said. That's exactly what I was trying to say. That's well said. Well said. Team, product, brand, these are the ways to build a great business, not legal shenanigans. And by the way, one of the reasons why the industry that everybody is moving around to different companies. I mean, what's the average term of employment? 18 to 36 months. Right. And you don't have to worry that if you've got some knowledge in your head, that you don't have to worry that if you use it at some new company, you're going to violate

Starting point is 00:57:57 some trade secret. But the one thing everyone knows not to do is take anything with them in terms of, you know, how to do it. to worry that if you use it at some new company, you're going to violate some trade secret. But the one thing everyone knows not to do is take anything with them in terms of, you know, not everybody. Not everyone. Now ski was that his name? Lou and that's why it's really what an idiot. I mean, sometimes people do break the rules. I mean, the rule is you don't take any work product with you. You don't take any documents, no thumb drives.

Starting point is 00:58:26 Don't bring your old computer to the new, no to the new job. Don't bring any old code. No, there are people who violate those rules. And that is definitely breaking the rules. But you're allowed to take with you anything in your head. And it is one of the ways that best practices sort of become more common. You guys know the story, right? Like Steve Chen, before he started YouTube, was an engineer at Facebook. And there was like, at one point, I remember being in some meeting where it was like, oh, I think we found an early version of the YouTube code on an old, on an old laptop that was a Facebook laptop that Steve owns. So I remember like the GC was like, I think we

Starting point is 00:59:05 technically own YouTube. I don't think we own YouTube. Could you imagine if Facebook sued Google to get YouTube? Speaking of startups, this is critically important for founders listening. If you're working at a company, the best practice is if you're going to do a side hustle is to get permission and a waiver from your boss that you're working on that. And get a clean machine. And you got to go on a clean machine. Your machine is being monitored. Cannot use your work computer.

Starting point is 00:59:34 Oh my God. Your work machine, I'm telling you right now, is being monitored every step of the way. I had- Well, it's not just monitoring. It's about who owns that IP. It's their property. It's their property. Absolutely. And if you type on it,

Starting point is 00:59:52 especially in this work from home era, and you know, anyway, I had a situation, I wouldn't say at which company, where a sales executive left the company, went into the CRM system, downloaded it, and he was so dumb. He had written plans for his next employer on his computer. And then in his corporate email, emailed the database and his plans for the new employer to his Yahoo or Outlook email. Oh my God. They busted him. Of course. They dropped a legal letter on him. They put a legal letter on the person was hiring him. The person who hired him rescinds the offer. Obviously, they don't want some toxic nonsense. And yeah, the person, you know, I have no idea what happened to you know, there's that very famous email that Steve Jobs sent to Bruce Chisholm, which goes something along the lines of Dear Bruce, it's come to my attention.

Starting point is 01:00:42 That Apple never recruits from Adobe, but it seems that Adobe is actively recruiting Apple employees. One of our practices have to change. Please let me know who or something like that. It's just a phenomenal email. Yeah. This actually resulted in a bunch of legal action, a settlement, because I think Eric Schmidt and Steve Jobs, correct me if I'm wrong, producers, or there was something between Google and Apple where they agreed. And I think Sergey or somebody was, yeah, Sergey got in on this is, I don't know if this is legal, but they didn't want to piss Steve off because it's not the kind of guy you want to piss off because he can execute. And Eric Schmidt was on the

Starting point is 01:01:27 board of Apple at the time, there's a very famous picture of them at the Palo, the, the Sand Hill Road or Stanford Mall, having coffee. And Steve is lit. He's not happy about this. And I think they agreed to not poach a certain level or something like that. Oh, there's the famous picture where they were breaking bread and then Eric Schmidt did Android. Steve felt very betrayed by this and Eric Schmidt left the board of Apple shortly thereafter. Because Steve reportedly felt like he was double crossed.

Starting point is 01:01:59 But you know, all that is speculation. So check your own facts. And do you have any other details on that free bird? Do you remember that case was after your time, right? I'll tell you a funny story. We had a meeting with the exec team from Apple when I was at Google, and Marissa mayor, and Sergey and myself and one other person went to the meeting. and Marissa's idea was why don't we pitch Apple that we could put a cache of the internet in 200 megabytes like the most important 200 megabytes of the internet, cache it and put it on the iPod so you could access the internet

Starting point is 01:02:36 on the iPod. Surf the web. Right. Basically search a cached version of the web. And that was the pitch and they kind of were like radio silent. They didn't respond to the pitch. And then they kind of blank faced stared at us. Two years later, the iPhone came out.

Starting point is 01:02:51 I have three amazing Steve Jobs stories. I'll tell you one of them right now. I was the co founder of a website called Engadget, which was a large blog in the world, we wound up selling the collection of this blog to a well, I was at a conference, Steve Jobs was there, He sees my badge, says engadget. He goes, Oh, Jason, engadget, my favorite tech blog in the world. I read it every day, yada, yada. And I said, Oh, that's great. And you know, and I said, Hey, can I ask you a

Starting point is 01:03:18 question? So yeah, sure. Anything. And we're out there. Beautiful view of the Pacific Ocean. And I said, You know, Steve, I have the iPod, I pulled that out of my pocket, and it had a color screen. And I said to him, I said, you know, it seems to me that I could download short video clips like of the Chappelle show, and I use that as an example. And they could sell them to me like you're selling MP3s,

Starting point is 01:03:39 and you could just buy like a Chappelle show issue episode, pretty obvious idea. And then I could play it when I'm on the subway or something or got some downtime in a cafe, I could watch a Chappelle show clips. Could you make a video version of this since it's already got the you know, storage in the screen? You look at me said, Jason, do you want to watch a thumbnail size video? I said, Yeah, totally fine. He said, all of our research says,

Starting point is 01:04:06 nobody wants to watch a tiny video like that. It's the worst idea ever. And I had this moment of like self doubt because he had that reality distortion field. I go back, I tell my guys what he said, and hey, should we write a story about it? And 30 days later, he releases the video and the ability to watch

Starting point is 01:04:25 videos on it. He had the greatest poker face ever. It was just an incredible moment. Man, I really miss that guy. What a incredible, incredible three doing a walk down memory lane of our Steve Jobs stories. Do you have one? I have to give us one. Come on. These are great. People loved, by the way, the segment when we went on. When I worked at Winamp, my boss, when it was merged into AOL to create AOL music was this guy, Kevin Conroy, great guy.

Starting point is 01:04:57 I remember Kevin. And Kevin basically got us runway to launch a 99 cent music download store. And we were able to use AOL's cards on file. So there was like 25 or 30 million credit cards. And we were able to use Warner Brothers music library because AOL had merged with Time Warner. And so we launched this 99 cent music store and it

Starting point is 01:05:27 performed phenomenally. And I went and I did demos for Walt Mossberg, Takara. I went to Apple, I showed James Higa, Eddie Q, Steve Jobs, all these guys. And AOL just couldn't do anything with the data. We kept pushing, Kevin kept pushing, but they were just so tied up in their own political nonsense, they wouldn't green light it becoming more than a beta. And then nine months later, the 99 cent download store launched on iTunes.

Starting point is 01:05:57 And I was just like, oh my God, this is execution. And they had all the labels and it was a thousand times better experience than we created. But it was the first time where I stumbled into something relatively accidentally and just got, frankly, owned by an organization that's just a thousand times better. Sacks, you ever meet Steve Jobs in person? No.

Starting point is 01:06:18 Freberg? Yeah, I met him at Macworld in 2003. He was walking the floor. It was at Moscone. I remember it because I've been a Mac user since 1984. First Mac original. I still have it in my office. Die hard, die hard Mac fan. I read every edition of Macworld, Mac user, Mac week. And so to meet him on the floor walking around, I was just like, like a 22 year old kid, I was freaking out. It was awesome. Only time I met him. He was the greatest. He was the absolute greatest. I have one other story, but I'm not going to share it. You know what segment people love last week? I interviewed with him for a job. What? Oh, come on. You cannot tell that story. When I left Facebook. People loved this story last week when we

Starting point is 01:07:04 did our childhood businesses. Hold on, I wanna hear the story, Chamath. Come on, Chamath. You give us one more, I'll give you one that's recorded on video. It's like so littered with my failures and my insecurities. But okay, like it was- Good, that's why we wanna hear it.

Starting point is 01:07:16 Yeah, that's why we wanna hear it. Get it out, get it out. And you start damn successful, be self-deprecating. Share with your brothers. There was basically somebody at a well-known recruiting firm who pinged me and said, hey, there could be a consult. This is right when I was leaving Facebook. And I had a pretty large project that never saw the light of day, which was this Facebook phone. Although people in the ecosystem knew that we were working on it. So, you know, Samsung and Intel were our partners,

Starting point is 01:07:42 AT&T and all this stuff. Anyways, long story short, there was a rumor that they wanted to consolidate iPhone into one business unit, right? And at the time it was kind of like very Balkanized or whatever. And I got approached by a recruiter saying, they're thinking of creating a role, which is kind of like head of iPhone. And at that point I was like, this is in 2011.

Starting point is 01:08:05 And I was adamant that I would never work for anybody until I heard it was Steve Jobs. And I was like, I will do whatever he says. Whatever Jobs. Wow. You were ready to bend the knee. Dude, I would have driven his car. I would have, yes, I would have driven that car.

Starting point is 01:08:22 I was like. You'd be driving Miss Daisy. Oh, Steve Jobs, you're my best friend. And I went through a couple of interviews. I'm not gonna get into those details. And at the end of it, it was like, well, he's not gonna become, he's not gonna be the CEO. He's gonna become executive chairman.

Starting point is 01:08:38 And so you'll be reporting to Tim Cook. And that's where that process died. They said I wasn't a good cultural fit for Apple in the new era. Now, and then it turned out what happened. Yeah, you would not have been. Scott Forstall laughed and I was not a good culture. I would not have been a good cultural fit for that.

Starting point is 01:08:54 No, he wanted radicals and Tim Cook wanted optimizers. So then I went and I started Social Capital, but that was my only job interview that I had when I was leaving Facebook. And it was for me, I had the same reaction as Freeberg. I was like a kid meeting his, I don't even wanna call it idol. Like, I think I was like a believer meeting Jesus.

Starting point is 01:09:20 That's how it felt. I will save my, just to get this, we gotta get through two more stories in the doc and I'm gonna leave my other Steve Jobs stories for another time. We got time. Well, you have that famous clip of you asking him that question where he basically was looking at you like,

Starting point is 01:09:36 that's a very famous one because that, you really got the better of him, I thought, which is pretty good here. All right, all right. Will you help companies like ours sell podcasts, be in audible? So if we wanted to sell a podcast through your service, would you help us do the fulfillment? You know, we're planning on having all the podcasts be free at first, but zing me an email with what you've got in mind and we're open to anything. Same email

Starting point is 01:09:58 I always send it to you? Yep. Okay. So strong. I mean, I got to give it to you, Jake, all you have balls. I mean, the truth is I traded emails with Steve many times he was with the press. He was full contact, as you know. All right. It's time. It's time for Saks red meat. And we've got a double serving for Saks. Saks stands are going to be really happy right now. TikTok's divest or ban bill has been signed into law. Senate passed the bill 79 to 18. We've talked about this here over and over and over again. President signed it.

Starting point is 01:10:35 This thing's on the fast track. Divest or shut down. TikTok bill was packaged, bundled, with $95 billion in foreign aid. $61 billion for the Ukraine, Ukraine, Ukraine, $26.4 billion for Israel and humanitarian aid for civilians in Gaza, and about $8 billion for the Indo-Pacific region, aka Taiwan. House added a provision to the bill that require the president to seek a $10 billion repayment from Ukraine's government.

Starting point is 01:11:08 Finally, they're talking about the lease back. We'll see if that ever happens. I'm curious what's next things there. Last year CNBC reported that ByteDance was buying back 5 billion worth of stock and early Thursday morning it was reported that ByteDance is exploring selling a majority stake in TikTok's US business. Looks like Gun to the Head is working to a non tech company without the algorithm. In other words, maybe they sell it to a Walmart, somebody who they don't consider super competitive. I'm not sure who the non tech company is here. Could be Disney would

Starting point is 01:11:38 come to mind as well. And remember, Disney did look at buying Twitter, but they didn't want the toxicity of an open platform. TikTok is obviously heavily scrubbed of anything that is aggressive. You can't show a movie clip with somebody getting attacked violently. It's very PG 13. But this is the key part, Saks, no algorithm in the package deal. Your thoughts on this. And you can take it either way you like, because I know your fans want to hear about everything. Do you want to talk the budget bundling or the TikTok ban which and the divestiture which seems to be happening? Well the overall theme is just that the National Security State got everything I

Starting point is 01:12:17 wanted. It got a hundred billion for to support Forever Wars, it got a TikTok ban and this divestiture thing is a total fig leaf because it's not clear that China is going to allow TikTok to divest because it would set a horrible precedent where the U S could just pass a law and then essentially steal the value of a Chinese company. So I don't think they're going to be able to divest. I think they're just going to get shut down. So the security state's getting its wish there.

Starting point is 01:12:44 And then another bill that you didn't mention, which they just passed, is they approved the warrantless spying on Americans. So the federal government can now spy on you and your communications without even getting a warrant. Ridiculous. Disgusting. So the national security state just seems to get whatever it wants. And there were large bipartisan majorities follow this.

Starting point is 01:13:06 The way they do it is they conjure all these fears to try and fear us into, well, if we don't agree to warrantless spying, then you could get a terrorist attack. Well, when has a warrant requirement ever gotten in the way of actually doing what we need to do to stop terrorism never but that fear was enough to get Congress to authorize that legislation They're keeping us involved in this forever war in Ukraine by this fear that Putin somehow gonna conquer all of Europe which I think is total threat inflation and this tick-tock Fear that somehow what videos we like is like precious data that's being

Starting point is 01:13:47 shared with the CCP. Look, I'm willing to believe it's possible, but they never proved that. Oh no, they've proved that data. It's been proved that they spy on journalists. When we debated this, when we debated this, you showed one article from the New York Times about how, yeah, that's not proof, JCal. Those were two rogue employees who shared some data with some New York Times about how, yeah, that's not proof, JCal. Those were two rogue employees who shared some data with some New York Times reporters.

Starting point is 01:14:10 That could happen to any company. I spoke to multiple TikTok employees myself personally, and they told me that the Chinese representatives are all over the company and inside of it. Freebird, your thoughts? But what was the judicial process or legislative process to prove that? Do they have hearings?

Starting point is 01:14:26 Do they prove that? I understand that your hearsay and your view is good enough to ban it, but I'd actually like to see some proof. My position on banning, thanks for asking, is based on reciprocity and the potential damage it could do and based on how influential and powerful the product is and how they could change sentiment and censorship.

Starting point is 01:14:45 And the Chinese government is fantastic at censorship and they're doing massive censorship inside the app. Handle it in a trade bill because what we've authorized here is not a TikTok ban. It is a sweeping new federal power to ban foreign adversary controlled applications. That's the new category. So we have a new category of foreign controlled apps,

Starting point is 01:15:08 whatever that means, and the government can now use it to shut down apps they don't like. And I guarantee you, I think here's where this goes next. I think Telegram is next on the hit list. You have a Russian founder, okay, you have rumors for years, I'd say unproven, that somehow Telegram's been backdoored by the Russian government.

Starting point is 01:15:28 You know, we've all heard those rumors. It's kind of like the CCP. Where is it based though? Isn't he out of there? He's in Monaco or something? He doesn't live there. Who cares? Do you think that matters?

Starting point is 01:15:37 He lives in Dubai, yeah. Pablo lives in... Here's what you're gonna see. You're gonna see, at some point, you'll see a media campaign that'll be promoting the idea that Telegram is used by Hamas, by terrorists, by groups that the US doesn't like, and that it's backdoored by Russia, and that it's got some shady investors on its cap table. And no politician is going to want to stand up and defend Telegram, and all the industry money that flows into Washington will be promoting this idea that we have to ban it, because think about the market share gains

Starting point is 01:16:14 that all of Telegram's competitors will make, and they're the ones wired into DC. So this is a foregone conclusion, I think. But you also said on Twitter, you thought this would come to Ax and to Rumble. You actually think they'll take this to American companies? I think that that seems like a stretch. Not really. I think that the first step is you go get telegrammed, because that's easy.

Starting point is 01:16:33 You know, this guy is an agent of Putin, obviously. And anyone who says differently is themselves an agent of the Kremlin. How does it jump to X and Rumble? That's how this rhetoric works. So first, they'll whack telegram, and by the way, we all know that companies are going to benefit enormously by slurping up that market share. And then if Biden wins the second term,

Starting point is 01:16:53 they will eventually set their gun sights on X. But look, that's a battle. Because in X, you have a billionaire who has resources who's willing to stand on his hind legs and fight. Yeah. And so they're not going to do that before the election. But look, if we continue to see more weaponization and more censorship, I believe that eventually

Starting point is 01:17:14 what they will do is try and push Elon to divest X. And look, all they got to do, listen, J. Cal, this act empowers the attorney general to open an investigation. So I think that in a second Biden term, they will open an investigation and to start ratcheting up the pressure on Elon to get rid of X because that's clearly what they want. Yeah. And the TikTok guy's bought off Trump already, so he's going to fight for it. Freeberg, your thoughts?

Starting point is 01:17:42 I don't agree that the Chinese government will shut it down. I certainly don't have any insight into what the Chinese government is discussing or thinking about doing, but there's a lot of money to be made here. So if I'm bite dance, I'm very likely gonna hire a bunch of bankers,

Starting point is 01:18:00 run an auction process and sell this thing. And I have a year to do it. This is a business that did 14 billion in revenue last year, according to a published report, 170 million Americans are active users of Tik TOK. A revenue grew 40% plus last year. So I don't know how they would just say, Hey, let's write this thing off and, and, and shut it down when we could probably generate. I'm basing that statement on published reports

Starting point is 01:18:28 that China has said they're opposed to the foresale of TikTok in the US. And I agree with you that it might change, but think about it if you're the Chinese government, you're adamantly opposed to this, you don't like the precedent, and you don't really care about tech entrepreneurs

Starting point is 01:18:45 getting rich. I mean, the founder CEO of TikTok lives in Singapore. Right. So why would they give a sh-? But now let's assume that they let it go through. Think about the implications. Morgan Stanley and Goldman Sachs get hired to run a joint process to auction this thing off, right?

Starting point is 01:19:02 They're gonna run this process for a period of months. There's only a certain number of folks that could actually make a bid to auction this thing off, right? They're gonna run this process for a period of months. There's only a certain number of folks that could actually make a bid to buy this thing. Maybe some of the big guys in private equity, Silver Lake and others try and pull some capital together to buy it, but I think it's more likely a big company tries to buy it. Syphius and antitrust will probably not be

Starting point is 01:19:22 as relevant here as it normally would be. Certainly syphius wouldn't be because it's being completely divested. Antitrust, there's a real question on whether they're going to be given some leeway. But even if antitrust does apply, who could buy TikTok in the US? There's only a handful of companies that could or would. Oracle, maybe Microsoft? They said it's not a tech is the report. That it's not a what?

Starting point is 01:19:48 Not a tech company. So that would be Walmart, Disney, you start to get to over maybe a media company, right? Yeah, so absolutely. I do think that there's a really interesting Netflix, maybe Netflix. So I think that there's a really interesting rewrite of the landscape a little bit here, where some of the traditional big tech companies, Meta, Google, have really had total control over the consumer media consumption on the internet, that there's going to be a real difference here that might be triggered in how the industry kind of is sorted based on the TikTok auction, if it does happen. And I think it's

Starting point is 01:20:25 probably look, we could argue all day about what the Chinese are going to do. But if it does go through, there's next story you're going to see in the Wall Street Journal is how much money the bankers are going to make on fees running the auction here. And, and then the next story you'll see after that is going to be about how the tech and media landscape has been reshuffled and rewritten by the tech talk deal. Chamath,, Pali Hapatia, our chairman dictator. Can't wait to see you at poker tonight. What are your thoughts on this, if any? I think the thing to keep in mind is that

Starting point is 01:20:52 the reason why the government is banning TikTok, and I'm totally speculating and guessing, has nothing to do with these silly little videos. But it is that the overwhelming majority of the people that download TikTok keep the microphone on, and it is an ambient passive surveillance device. And I think to the extent that a foreign government has access to whatever you hear, ambiently and randomly, while the app is not even being used, is the real problem here.

Starting point is 01:21:21 And so I think that that's effectively what this is, is a listening device into enough Americans. And I think that that's pretty scary to folks. The second thing is with respect to the actual product itself, in the absence of that algorithm, which I think is just incredible, as somebody who was a voracious user of that app until I deleted it, I don't think the product is much of anything. It's probably no better or no worse than shorts or reels or some of these other alternatives. So I don't see the economic justification for anybody who already has one of

Starting point is 01:21:54 these assets to buy these things because the content is roughly the same now. It is the thing that makes that app is the algo. But the videos are everywhere. They're on YouTube, they're on Instagram, they're everywhere. So I don't see why anybody would pay a lot of money for this, especially in the absence of the algorithm. This is my honest thought. What do you think, Shigha?

Starting point is 01:22:17 I think this is a security risk. I've made that clear here before. And I don't think we would ever allow Iran, North Korea, Russia to run any of these companies inside of America, nor would they allow us to run Facebook, X, et cetera, in their countries. So I think reciprocity is the key. But I am running a little test right now. I posted this video to my TikTok today, and it's under review. They won't let it publish. And the video is very simple.

Starting point is 01:22:49 It quotes a study from Reuters. You don't have to play it. I'll explain what I said in it. But I just took a video of the Reuters study. What this Reuters study shows you, pull up the chart there, Nick, is that in this Rutgers study, the CCP is censoring sensitive topics related to China. And so if you want to understand why the CEO, who I think you may have worked with before, Chamath at Facebook, the CEO is saying it's a ban when in fact it's a divestiture.

Starting point is 01:23:17 If you want to understand why they care about this, it's because they want to be able to influence things in America. They want to have data on Americans. It's because they want to be able to influence things in America. They want to have data on Americans. It's spyware. That's my position. And it's the most censored platform, I think, in America, which I know you feel passionately about sex. So I did this video and just like COVID-19 was blocked on X here in America, in the US. If you talked about Wuhan, if you talked about any of these topics, our government banned it.

Starting point is 01:23:50 Well, if you talk about Hong Kong, if you talk about Uighurs, if you talk about Tiananmen Square, your video will not be posted. In fact, my video is held right now. So, if you're hearing my voice right now, I'm doing a little experiment. I want everybody

Starting point is 01:24:05 to post that chart and just read the Wikipedia page, maybe talk about Tankman, talk about the Hong Kong riots, and then use the hashtag don't ban TikTok as a little bit of a cheeky way for us all to track each other's. And I want to see if a hundred or a thousand all in fans post one of these, if they all get banned, or if we can see any of them so we can do a live censorship test here in America, are Americans allowed to talk about Tiananmen Square, the Hong Kong riots, Uighurs or any of those things?

Starting point is 01:24:35 And you can also, if you want, have mentioned me, I'm at Jason Calacanis on TikTok. So that's my position on it. I want to see this thing banned immediately or divest. I would prefer it be divested. Because I think people love it. One quick thing, I think what Sac said is really interesting about them then going after Telegram.

Starting point is 01:24:56 The big issue that I think Telegram has always had is that it is encrypted, but it has its own form of encryption that they rolled themselves, right? Like typically, I think WhatsApp and a lot of these other folks just use pretty standard signal. I think as well use SHA-256 encryption,

Starting point is 01:25:13 which is like pretty standard, but there's always a fear that the US government actually can unencrypt that and has some kind of a backdoor. That was always the fear of the SHA-256. And so Pavel Durov and his team basically rolled his own, which is also 256-bit symmetric encryption, but different standard altogether. And what people would say is, hold on, he has the backdoor to Sachs's point. So that was always the claim, counterclaim between these things of why Telegram

Starting point is 01:25:41 was always painted in more of a sketchy corner. I'm not saying that it's true. And I think that if they go after it, I think it's because this underlying encryption model is something that we can't get access to. And so they'd rather just eliminate it to your disaccess point. All right. I think Telegram can stick its head between its legs and kiss its ass goodbye because they're next on the hit list. All right, we're gonna see. What do you think of my Don't Ban TikTok Challenge? The non-security state has has used fears like the one that Jake helped explained to get a new power. And it's not a power

Starting point is 01:26:15 to ban TikTok. It's a power to ban any foreign controlled app. So goodbye, Telegram. What do you think of my Don't ban TikTok challenge, Sax? The censorship challenge. Yeah. I mean, fine. Whatever. Wow.

Starting point is 01:26:30 You're so passionate about censorship. It's done. It's over. It's over. Look, the national security state gets whatever it wants. It's pretty clear. Not if we stay vigilant. I mean, if we keep talking about these things-

Starting point is 01:26:40 Well, how did this warrantless spying thing happen? I mean, look, I think the warrantless spying is actually worse than the TikTok ban. Yeah, that's insane. Me too. 100 times. How are they not required to go to a court to get a warrant? That's so easy, by the way. Have we eliminated the physical courts entirely? We don't need those anymore either? They can just do whatever they want? Well, I think we saw FISA, but you don't have to go to the court to get a warrant. They can just do whatever they want. That's insane. Let's take a deep dive in a future episode, because we're running out of time.

Starting point is 01:27:05 We really should. We need a little more story to get to. Let's deep dive. Listen, there's a lot of topics people want us to talk about. And this one, I think people are talking about a whole bunch. It's kind of breaking. I couldn't find a Wall Street Journal or a Washington Post covering this, but a lot of people were talking about it on X.

Starting point is 01:27:22 Biden's 2025 budget includes some serious capital gains hikes. There are three proposals in the 2025 budget. We'll put all the links in the show notes to increase cap gains rates, as opposed to income cap gains. If all three are passed, big if it would more than double the long term capital gains tax to almost 45%. Important to note, this only covers those making 1 million or more a year, which is like, you know, less than 1% of the country, way less. And so this is definitely a tax the rich idea here. Currently, the highest long term capital gains rate is 20%, which is really about 24% of you earn more than 200k per year,

Starting point is 01:28:03 because you have to pay an extra small tax. If these proposals become law, big if it would create the highest cap gains rate in 100 years. Here's the chart. This comes from Americans for tax reform, which was done by a Reagan era, an NGO, I think that was formed by a former Reagan administration. They basically make politicians sign that they won't increase taxes. The budget also proposes a 25% unrealized cap gain tax. This would be a tax on total income, including unrealized cap gains for all taxpayers worth over 100 million. OK, Saks, I know this is your red meat. There's a lot of pieces here, but gosh, this is crushing for those folks who want to vote

Starting point is 01:28:45 for Biden but are moderates because this is like the number one thing you can do to stop innovation and investment in the country, which we desperately need. This is a head-scratcher. Biden is playing a game of chicken with the tech industry and with, I'd say, suburban voters in general. I mean, is this what you want? At some point, you're gonna have to say that this is not okay. I mean, first of all, you've got this 25% unrealized gains tax, which is a wealth tax. If you're somebody who's created a small business, or a family farm, or you're a tech founder, if you get to qualify for the amount, then you've got to pay 25%. And in order to raise the money for that 25%,

Starting point is 01:29:28 you're going to get taxed on, let's say you try to sell 25% of the company, you're now going to get taxed 45% of that plus 13.3% California. So really you're going to have to sell more like 40% of the company just to pay off this unrealized gains tax. And by the way, you haven't made a dime yet. You don't put a dollar in your bank account.

Starting point is 01:29:48 And that's your one confiscation. That's your one. What, what, what happens the following year? This is the actual insane, insane. This is, this is ridiculous. These things will never pass. Let me tell you, I mean, so, so this is in Biden's budget for next year. And this idea, this is not the first time we've seen this.

Starting point is 01:30:05 It was in his original Build Back Better proposal. And the only reason that failed is because Manchin and Sinema voted against it. So Manchin and Sinema are not gonna be in the Senate next year, okay? They're not running for reelection. So if the Democrats have the trifecta, if Biden wins reelection and holds on

Starting point is 01:30:23 to the Senate and House, but without mentioning cinema, I think you have to price in the strong possibility that this passes. I don't think you can just shrug it off. Freeburg, your thoughts? Well, we're talking about it here. We're not shrugging it off. This is like five along fire here on X. Everybody's talking about it. Freeburg, your thoughts? There was a poll published yesterday, Bloomberg News Morning Consult surveyed 4900 registered voters in seven swing states. And the poll showed that 77% of registered voters in those states, support basically an asset tax on ultra high net

Starting point is 01:31:04 worth people people worth over a hundred million dollars to keep social security intact. So I think that's a strong indication of where things are headed generally. We can debate the tactics and the nuance of this election cycle, but as we all have talked about and know, social security becomes de facto bankrupt by 2033, perhaps earlier.

Starting point is 01:31:27 So we have a few years to figure out whether we cut social security benefits in this country or find alternative ways to fund it. And it's pretty evident from this poll that Americans are not in support of raising the minimum age from 67 to 69, which was one of the questions in here. of raising the minimum age from 67 to 69, which was one of the questions in here. Only 25% of Americans support raising the minimum age for social security from 67 to 69. Meanwhile, 77% strongly support a tax on ultra high net worth to fund the gap, the funding need. Well, yeah, I mean, that's a loaded question because you're basically positioning this tax, which is really complicated in the details and the person getting asked

Starting point is 01:32:13 the question doesn't understand it compared to the most popular program that the federal government has, which is social security. So obviously, it's going to pull that way. I mean, look, you can you can ask a question in a way on a poll to get whatever answer you want to get to. I can basically prove to you that a majority of the American public is either for Ukraine funding or against Ukraine funding, depending on how you ask the question. And look, yeah, obviously, taxing people with $100 million of paper wealth is going to be more popular than sacrificing your social security, obviously.

Starting point is 01:32:49 But that doesn't mean that this is a good proposal economically at all. No, it doesn't. And I don't think that that's what really matters. I think most folks are voting for themselves, their particular needs, and the majority of people need more support. And they're- This is not even going to save social security. I mean, you know, what is this? This tax going to get us.

Starting point is 01:33:09 It's going to destroy the startup ecosystem. It's not going to balance the budget. We're still spending way too much for that. It doesn't pay down the debt. It doesn't save social security. It's just more and more taxes. I think that's the inevitable trend. I'm just saying, I don't know how it's going to manifest, but I think it's the inevitable trend. I'm just saying I don't know how it's gonna manifest

Starting point is 01:33:25 but I think it's inevitable that we're gonna raise federal revenue through some form of taxation that's gonna feel deeply uncomfortable and Inappropriate and it's gonna have negative economic consequences. And this is where the economic spiraling But yeah, I talked about Actually had a brilliant blog post about this called all it takes is all you got and What he pointed out is he was talking about the federal government's runaway Deficits and debt and borrowing and somebody responded to him With this chart that shows assets versus liabilities this This guy, Brent, who I guess is a foil on X for biology sometimes, said, oops, you only showed one side

Starting point is 01:34:11 of the balance sheet. Common mistake though, basically saying that biology didn't know what he was talking about because biology was only showing the red, which is the government liabilities, the government debt. And he showed that, well, no, you have to include all the green bars. But what are the green bars?

Starting point is 01:34:25 Those are private assets. And Balaji pointed out that, no, actually, you're proving my point because people like you just see all of the private assets of citizens of the United States as belonging to the government. Yeah. And if you actually extend the red bars to the present value of all the long-term liabilities that this government has, it's more like $175 billion. People like this see the $160 trillion of private wealth as being on the balance sheet

Starting point is 01:34:58 of the federal government and being used to offset the $17 175 trillion of liabilities. In other words, all it takes is all you got. That's the trajectory we're on. Is we have a one- Yeah, your home, your 401k is the government's. And we're gonna use it. They're gonna absolutely go after your retirement accounts. Because that's the only way they're gonna pay

Starting point is 01:35:19 off these liabilities. It's gross. Unless you wanna stop it now. Yeah, there's another idea, cut spending. Cut spending, right? Well, there's another great tweet by a guy who said, cause another idea, cut spending. Cut spending, man. Well, there's another great tweet by a guy who said, laptop mercenary, I don't know this account,

Starting point is 01:35:29 but he said something funny. He said, imagine being a California high earner, options, either vote for your own financial liquidation or vote for the orange man. Yeah, it's brutal. Checkmate, dude, checkmate. You guys just gotta put on the red MAGA hat. It's happening.

Starting point is 01:35:45 Here's the thing, I mean, I read that you're all in. You don't have to wear the red MAGA hat. When you go into that polling booth, nobody knows the button you're pushing. Yeah, okay, there it is. I mean, these are the two worst candidates in the history. Jason, Biden has had four years to prove that he's a moderate. He's had four years to prove that he represents the normalcy that he promised to us when he first

Starting point is 01:36:12 got elected. That's been refuted. I mean, how much more does it take for you to understand that his policy is radical? Yeah, I mean, he combines the foreign policy of Dick Cheney with the economic policy of Elizabeth Warren How much more does it take? Are you going to vote for your own financial liquidation? Because that's what we're talking about. It's the worst two candidates and I think i'm voting for the third Oh an rfk endorsement. Wow. I didn't I didn't see that I think I just have to put in the protest vote of rfk or a lot of rfk. I think he's a great vote Yeah for democrats. I love RFK. I think he's a great vote. Yeah.

Starting point is 01:36:45 For Democrats. I mean, crazy. I think maybe I go after the rock. But yeah, congratulations on Biden on making this easy for Trump with his build back broke plan. So dumb. All right, everybody, this is the world's greatest podcast. By the way, Jason, if you do decide in the end to vote for Biden, I'll send you some luxury tents that you and your kids could sleep in. You can tell them stories about how you voted for him. It's so brutal. I mean, the worst two candidates of our lifetime.

Starting point is 01:37:18 J. Cal, here are your choices, okay? You can vote for Trump or you can give up the ski lodge. What's it gonna be? I mean, at this point, I think I'm RFK all the way. I think I got to go for just try to support independence. I just think we got to balance the budget. Shout out David Friedberg for the Rain Man himself, David Sacks. Yeah, David Friedberg, the Sultan of Science, we didn't get to science corner this week, we're gonna start with it next week. And the chairman dictator Chamath Pali hoppitya. I am world's greatest

Starting point is 01:37:52 moderator of the number one podcast in the world I'm manifesting can we get the Spielberg I'm manifesting track in here and take us out Spielberg young Spielberg baby coming at you. Take us out Spielberg young Spielberg baby coming at you 100 love you boys. Bye. Bye Welcome everybody to episode 175 Is the largest most listen to podcasts in the world? I'm manifesting. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest.

Starting point is 01:38:46 I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest.

Starting point is 01:38:54 I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest.

Starting point is 01:39:02 I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. I'm gonna be a manifest. And now the plugs follow the show at x.com slash the all in pod. Our tick tock is at all underscore in underscore talk. Our Instagram is the all in pod and on LinkedIn search for the all in pod cast. The show is produced by producer Nick Calacanis and our CEO is John Hale. You can find chamath at x.com slash chamath and you can sign up for his weekly email. What I read this week at chamathcom slash Shamath and you can sign up for his weekly email. What I read this week at Shamath.substack.com. Sign up for a developer account at console.grok.com and

Starting point is 01:39:51 follow Sandeep Madhra x.com slash Sandeep. You can follow David Sachs at x.com slash David Sachs. Sachs recently spoke at the American moment conference. It's his pin tweet on his x.com profile. Follow David Friedberg, the Sultan of science at x.com slash Friedberg. Oh, hollow is hiring and David Friedberg is the CEO. You can click on the careers page at Oh hollow genetics.com. We're hiring a full time researcher here. We need somebody who can do data research for us. We're looking for somebody to make charts and do surveys and research deep research. If you'd like to apply, go to all in podcast.co slash researcher all in podcast.co slash researcher to

Starting point is 01:40:36 apply. The summit is taking place in September in Los Angeles again at UCLA summit.allinpodcast.co. I'm Jason Calacanis. You can follow me on x.com slash Jason, or search for this week in startups on YouTube and follow my other podcast. I'm hosting my liquidity conference again in Napa on June 2 to the fifth. Only LPs and GPs come to this event 125 people every year. This year's speakers include Ibrahim Ajami from Mubadala, David Freberg, Chamath Palya-Hapitiya, Gavin Baker, Jordan Stein from Crescent Partners, Monique Woodard from Cake Ventures. I'm an LP. My guy, Peshman from Para Ventures, and Phil Deutsch, my bestie, liquiditypod.com slash summit to apply for one of the few remaining tickets. We'll see you next time.

All-In with Chamath, Jason, Sacks & Friedberg - Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax

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